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The service is initially available via 50 base stations around Johannesburg and Pretoria, and is subject to a 24-month contract.

Neotel says it will deliver uncapped, unshaped data using the 1,800MHz spectrum at speeds of 2Mbps, 5Mbps and 10Mbps. The faster packages will cost R1,799 and R2,899 respectively.

The company previously provided a mix of services based on fibre and EV-DO connectivity. With the launch of its latest service, it takes on the established mobile operators Vodacom, Telkom Mobile, MTN and Cell C, who have all been expanding their own LTE coverage over the last year.

Prior to the Neotel launch, the South African market was already extremely crowded, and the CEO of Cell C Alan Knott-Craig recently confirmed that his company had been in talks regarding consolidation with Telkom Mobile. Neotel's new service will be specifically targeted at business customers, however, and analyst Arthur Goldstuck of World Wide Worx says he doesn't expect it will affect competition for consumer accounts.

"Neotel's main aim is to use LTE to improve its existing services," he said. "These speeds are for replacing fixed lines, not for competing for mobile broadband customers. The company's core strengths have always been in the enterprise."

Competition is increasing elsewhere, however. Two new consumer MVNOs have also launched in the last month emphasising mobile data over voice from ISP Afrihost and Red Bull Mobile.

While all LTE services are still limited to the major urban areas, the development of high speed wireless services to rural areas and at lower cost was highlighted this week as a key priority by the new minister of communications, Yunus Carrim.

"We want to see realistic progress in broadband becoming more extensive, affordable and speedier," Carrim told the South African National Editors Forum. "We intend to finalise the government’s National Broadband Policy and Implementation Programme within three months."

At present, only 10 percent of the country has access to fixed line broadband, and LTE services regularly outperform ADSL networks in tests. Capped bundle prices make them an expensive option, even by South African standards — Vodacom, for example, offers 40GB of data for R999 on contract. According to a recent report by Research ICT Africa, almost four-fifths of all internet subscriptions in the country are over mobile.